Plaintiffs who
brought an action against their condominium homeowners’ association and several
individual defendants, which was settled as to all defendants but one, and who
then voluntarily dismissed their action against the hold-out defendant, are
liable for her attorney fees as the prevailing party, the Court of Appeal for
this district has held.

The
decision by Div. Seven came Monday in an unpublished opinion by Justice John
Segal. It reverses an order by Los Angeles Superior Court Judge Susan
Bryant-Deason.

Bryant-Deason
relied on Civil Code §1717(b)(2), which provides:

“Where
an action has been voluntarily dismissed or dismissed pursuant to a settlement
of the case, there shall be no prevailing party for purposes of this section.”

Segal
noted that the nonconsenting defendant, Ada Wang, was seeking to vindicate her
view of the requirements of the condominium covenants, conditions and
restrictions (CC&Rs) relating to an alleged failure to maintain and repair
common areas. Segal wrote:

“Section
1717, however, only applies to an ‘action on a contract, where the contract
specifically provides that attorney’s fees and costs, which are incurred to
enforce the contract, shall be awarded....’ Because there is no attorneys’ fees
provision in the CC&Rs (or in any other relevant document), section 1717 is
inapplicable.”

“In
an action to enforce the governing documents, the prevailing party shall be
awarded reasonable attorney’s fees and costs.”

No
exception is set forth in that statute where there is a voluntary dismissal,
Segal pointed out.

Even
after the dismissal as to all defendants other than Wang, he said, the
plaintiffs sought payment by her of up to $5,000.

The
jurist observed that the plaintiffs “may now say they recovered the ‘lion’s
share’ of what they sought in the case, but the record shows that, even after
settling with the other defendants, they still wanted a ‘cub’s share’ from
Wang.”

The
opinion clears the way for Wang to resume seeking the $35,420 she claims is
owed to her in attorney fees. The cumulative amount paid by the settling
defendants was $45,000.

The
case is Durack
v. Wang,
B276086.

Stephen
C. Duringer and Edward L. Laird of the Duringer Law Group represented Wang
while Christie Gaumer acted for the plaintiffs.

Laird
commented yesterday:

“This
decision demonstrates that in the HOA context, a homeowner or HOA who sues
another homeowner cannot expect to be able to dismiss the action without consequence
if it later turns out that the claims asserted are tenuous, the cost of
litigation too much, or the claimant basically got what it wanted from other
defendants. Here, the court held that Civil Code Section 5975 compelled a
finding that a defendant who was dismissed before trial was the prevailing
party for purposes of attorney fees.”

He
continued:

“Significantly,
the court found this to be a proper result even assuming that the dismissal
didn’t have anything to do with the probability of success. There is no need to
try and analyze who might have won at trial. By such dismissal, ‘on a practical
level,’ the defendant obtained its litigation objectives. The same result
generally follows even though the plaintiff may have been successful against other
defendants. Moral, if you want to sue another homeowner in your HOA, do
your due diligence and be ready to go the distance.”